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Export Violations Yield Penalty, Suspension of Export Privileges

Monday, November 18, 2019
Sandler, Travis & Rosenberg Trade Report

The Bureau of Industry and Security has imposed a $136,000 civil penalty against a U.S. company to settle charges that it exported electric cattle prods, which are controlled on crime control grounds, to Venezuela, Mexico, South Africa, and the Czech Republic without the required export licenses. BIS states that while the company had previously applied for and received a number of export licenses for such items, including to some of the destinations and end-users at issue, it failed to do so on each required occasion and also failed to properly monitor the expiration dates of the licenses it was granted.

BIS will suspend $86,000 of the penalty for four years provided that the company commits no further export violations during this time. If the company fails to timely pay the other $50,000 or otherwise comply with the settlement agreement, BIS may deny its export privileges for two years.

Separately, BIS has issued orders suspending the export privileges of individuals and companies convicted of the following crimes. As a result, neither these individuals nor anyone acting on their behalf may directly or indirectly participate in any way in any transaction involving any commodity, software, or technology exported or to be exported from the U.S. that is subject to the Export Administration Regulations. BIS is also revoking all export licenses in which these individuals had an interest at the time of their convictions.

- ten-year suspension for willfully conspiring to export and causing to be exported gas turbine parts to Germany with knowledge that the parts were intended specifically for reexportation to Iran without the required U.S. government authorization (individual previously sentenced to a $5,000 fine and a $100 assessment)

- six-year suspensions as part of separate agreements settling charges that two companies and two individuals participated in a conspiracy to unlawfully export goods through transshipment points to Syria without the required U.S. government license (final two years of denial period for the individuals suspended provided they commit no further export violations)

For more information on export laws, regulations, and controls, please contact export compliance attorney Kristine Pirnia.

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